One of the War Room members spotted this setup and I thought I would share it.
The 4 hour chart on the GBPUSD shows a clear resistance level which price has failed to push through on 3 attempts.
The last test of this resistance caused a strong reaction by the bulls, heavily rejecting higher prices and forcing the candle to close lower than the open price.
Now we’ve got a strong bearish rejection candle reversal signal off this resistance level, signalling that prices want to move lower. The anatomy of the candle is also very strong, with the body being so thick on the bearish side, really giving the setup that extra aggressiveness.
Nice Bearish Sell off Response from Bearish Rejection
The market followed through very nicely off the bearish rejection candle signal that we just covered recently, giving price action swing traders the opportunity to bank some good returns.
Because the move was so aggressive, a bearish outside candle as printed on the daily chart as a result.
Now the daily chart also looks quite bearish, with a nice mean looking bearish outside candle sitting right there on a swing level.
If price breaks the low of the outside candle this week, we could see a much more deeper move into lower prices.
Bishagith Kar
It works !!!